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Forexpros – Gold futures traded higher Thursday, as market participants weighed the odds of additional central bank easing measures.
On the Comex division of the New York Mercantile Exchange, gold futures for October delivery traded at USD1,614.15 a troy ounce during late U.S. trade, adding 0.59%.
Gold futures were likely to find near-term support at USD1,590.25 a troy ounce, Wednesday’s low and the lowest since August 3 and resistance at USD1,616.75, the high from August 14.
Market participants will be watching a slew of U.S. data later in the day, in an attempt to assess the strength of the U.S. economic recovery and the need for further stimulus.
The U.S. was to publish official data on building permits, as well as weekly government data on unemployment claims. The country was also to release official data on housing starts and a report on manufacturing activity in the Philadelphia area.
Data on Wednesday showed that industrial production in the U.S. rose more than expected in July.
The data came one day after a report showed that U.S. retail sales snapped four successive months of declines in July, jumping 0.8%, outstripping expectations for a 0.3% increase and dampening expectations for another round of quantitative easing by the U.S. central bank.
But investors remained cautious after data on Wednesday showed that a gauge of manufacturing activity in New York fell into contraction territory in August for the first time since October 2011.
Moves in the gold price this year have largely tracked shifting expectations as to whether the U.S. central bank would pump more money into the financial system.
Gold prices found further support after Chinese Premier Wen Jiabao said late Wednesday that slowing inflation provides “growing room for monetary policy operation” to spur growth in the world’s second largest economy.
The remarks added to ongoing speculation policy makers in Beijing will cut banks’ reserve requirements or benchmark interest rates again after inflation cooled to a 30-month low in July.
The People’s Bank of China has lowered both twice so far this year in an effort to boost lending and stimulate growth.
Expectations of monetary stimulus tend to benefit gold, as the metal is seen as a safe store of value and inflation hedge.
Elsewhere on the Comex, silver for September delivery gained 1.20% to trade at USD28.14 a troy ounce, while copper for September delivery shed 0.15% to trade at USD3.345 a pound.
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